Question 3 (a) Dios Limited imports product L and sells the product to retail customers at a price of K14 per case. Dios Limited had no inventory at the beginning of December and during December the following receipts and sales were recorded:

- 6 December Received 1,400 cases @ K8.20 per case

15 December Received 900 cases @ K9.10 per case

20 December Sold 780 cases

22 December Received 330 cases @ K9.90 per case

28 December Sold 860 cases

(i) Using the FIFO method of inventory valuation, the gross profit reported for December would be K. (ii) Using the LIFO method of inventory valuation, the gross profit reported for December would be K.. (10 marks)

(b) Discuss the advantages and disadvantages of the following stock valuation methods

(i) LIFO (ii) FIFO (iii) AVCO (10 Marks